We propose to econometrically study the simultaneous supply and demand behavior of non-physician hospital health care personnel. A key objective is to determine the extent of cost-effective substitution among the major input categories of registered nurses, licensed practical nurses and hospital assistants. Where it is legally and technologically feasible, such substitution implies economic efficiency, and is a desirable means of reducing the total cost of health care in this sector. Another key objective is to analyze the supply response of nurses and assistants to major economic variables. In particular, we will seek to establish the degree to which these groups can be treated homogeneously for policy purposes, and to identify the most cost effective policy prescription that will increase their supply in times of shortage. The data to be employed will be cross-section by states. The econometric technique will be three-stage least squares estimation of the entire simultaneous equations structure, which in this context is more efficient than single equation methods.